Romas and Olympia Linas v John Robert Maroon, Chris Maroon and Archiform Group Pty Ltd
[2014] NSWCATCD 51
•16 April 2014
Civil and Administrative Tribunal
New South Wales
Case Title: Romas and Olympia Linas v John Robert Maroon, Chris Maroon and Archiform Group Pty Ltd Medium Neutral Citation: [2014] NSWCATCD 51 Decision Date: 16 April 2014 Before: D Goldstein, Senior Member Decision: The first respondent must pay the applicants the sum of $61,766.19 within 21 days of the date of the order as damages for breach of contract.
The applicants' claim for $14,969.00 for overpayments is dismissed.
The applicants' claim against the second respondent in connection with project management services is dismissed.
The applicants' claim against the first and second respondents under the Australian Consumer Law is dismissed.
The parties are at liberty to make a costs application in these proceedings.
Any costs application pursuant to section 53 of the Consumer, Trader and Tenancy Tribunal Act 2001 must be lodged in the Tribunal and served on the costs respondent within 21 days of the date of this order either attaching or referring to the documents relied upon in support of the application.
The costs respondent will have 21 days after the date it receives the application referred to in the preceding paragraph to lodge in the Tribunal and serve on the costs applicant its submissions, if any, in response to the cost applicant's costs application, such submissions either attaching or referring to the documents relied upon.
The cost applicant will have 14 days after the date it receives the cost respondent's submissions to lodge in the Tribunal and serve on the costs respondent its submissions, if any, in reply, such submissions either attaching or referring to the documents relied upon.
The Tribunal will determine any costs application on the basis of the submissions and document lodged in the Tribunal.
Legislation Cited: Home Building Act 1989 Category: Principal judgment Parties: Romas and Olympia Linas (applicants)
John Robert Maroon (respondent)
Chris Maroon (respondent)
Archiform Group Pty Ltd (respondent)Representation - Counsel: Mr Weinburger (for the applicants) - Solicitors: Gadens Lawyers (for the applicants)
The first respondent was self-representedFile Number(s): HB 13/39778 Publication Restriction: Unrestricted
REASONS FOR DECISION
This dispute arises out of renovations and additions to the applicants premises at 16 Gore Street, Parramatta ("the property").
The facts in issue relate to the preparations and planning for the building work carried out at the property, the work that was carried out under a building contract entered into between the applicants and the first respondent and the roles played in the carrying out of the building work by the second and third respondents.
As I understand the parties respective positions, there is no dispute that the applicants' claim is a "building claim"; as defined in section 48A(1) of the Home Building Act1989 (the "Act") and that the Tribunal has the necessary jurisdiction to determine the building claim.
An ASIC search conducted by the Tribunal before the final hearing discloses that the respondent Archiform Group Pty Ltd was deregistered on 17 November 2013. On that basis the case against that company was not pressed.
Respondents' solicitors
On 3 April 2014 Watson & Watson solicitors sent to the Tribunal their letter dated 31 March 2014 in connection with HB 14/04873 stating that they previously acted for but no longer acted on behalf of John Maroon, Chris Maroon and Archiform Group Pty Ltd.
HB 14/04873 is a cross application by Mr John Maroon against the present applicants. Watson & Watson are the solicitors for the respondents in these proceedings. I assume that their letter relates to these proceedings and to HB 14/04873. In any event, Watson & Watson did not appear at the Tribunal on 8 April 2014 to represent the respondents.
Adjournment application
The respondent Chris Maroon sent the Tribunal an email at 4.49 pm on 4 April 2014 seeking an adjournment of the hearing of these proceedings on 8 and 9 April 2014. He attached a Medical attendance certificate from Westmead Hospital, an eDischarge document from Westmead Hospital and two medical certificates. One medical certificate was dated 31March 2014 and stated that Christopher Maroon was receiving "medical treatment" and would be unfit to continue his usual occupation from 31 March 2014 to 7 April 2014. The second medical certificate was dated 3 April 2014 and stated that Christopher Maroon was receiving "medical treatment" and would be unfit to continue his usual occupation from 3 April 2014 to 10 April 2014.
Mr John Maroon attended at the hearing and sought an adjournment on the basis that Mr Chis Maroon was unable to attend the hearing. He stated that Mr Chris Maroon was conversant with all of the details of the case, whereas he was not. Mr Maroon had not arranged for the expert building consultant whose written report had been filed in the Tribunal to attend at theTribunal to give evidence on behalf of the respondents.
I refused to allow the adjournment.
The applicant's case was presented, evidence was tendered. Mr John Maroon was left in the position of having to conduct his defence. He was however allowed a short adjournment to discuss his position with his former solicitors Watson & Watson in order to ascertain whether he was in a position to arrange their attendance to represent him. As it turned out Messrs Watson & Watson did not attend at the Tribunal to represent Mr John Maroon.
The grounds for declining the first and second respondents' request for an adjournment was made on a number of bases.
First, the medical information from Westmead Hospital was quite specific as compared to the medical certificates that were general and non-specific. The medical attendance certificate from Westmead Hospital stated that Mr C Maroon was in hospital from 16 to 18 March 2014 and that he would be unfit for work activities from 16 to 30 March 2014.
The eDischarge document from Westmead Hospital confirmed that Mr C Maroon was in hospital from 16 to 18 March 2014. The document indicated that Mr Maroon had been diagnosed with Pancreatitis, full details of which were provided, and had been discharged once his symptoms had settled. It also indicated that Mr Maroon was discharged with "GP follow up". He was advised to have a low fat diet and a MRCP was booked for him on 23 June 2014.
Given that a MRCP was booked for Mr C. Maroon on 23 June 2014, I infer that his health was not in imminent danger. I also infer that Mr Maroon was in a stable condition as the eDischarge stated that his symptoms had settled. Mr Maroon was not placed on medication, but was advised to go on a low fat diet.
I have had regard to the medical certificates that are referred to above and have reached the conclusion that they are part of the GP follow up referred to in the eDischarge document. Based on the paucity of information in the medical certificates, the fact that Mr Maroon has not produced a statutory declaration or an affidavit which elaborates on his condition, and the detailed information contained in the Westmead Hospital documentation, I do not place a great deal of weight on the information contained in the medical certificates. In considering the adjournment application I have placed greater weight on the documents from Westmead Hospital because of the detailed nature of the information which they contain.
There is also the fact that the second certificate referred to was dated 3 April 2014 and stated that Christopher Maroon was receiving "medical treatment" and would be unfit to continue his usual occupation from 3 April 2014 to 10 April 2014. This medical certificate was obtained only three days after the first medical certificate was obtained, 31 March 2014. At that time the first medical certificate was still valid. The medical certificates were from the same Medical Centre, but were signed by different Doctors.
From the facts referred to in the preceding paragraph, I infer that the second medical certificate was obtained by Mr C Maroon for the purposes of providing an excuse not to attend at this hearing.
Secondly, the second respondent Mr C. Maroon made his application for an adjournment late. The Chairperson's Directions Concerning Adjournments states that if a hearing is scheduled to run for more than one day, an application for an adjournment should be made at least five clear working days before the adjournment. Mr C Maroon's application was made one clear working day before the hearing.
As stated in paragraph 1.3 of the CTTT Chairperson's Directions Concerning Adjournments, "Unless notified by the Tribunal of an adjournment, a party must assume that the hearing will proceed in their absence".
Rule 38 of the NCAT Procedural Direction relating to Home Building Disputes effective 1 January 2014 states:
"38. No Tribunal process or fixture (including final hearing, directions hearing, mediation, conciliation or expert conclave) may be adjourned without the express approval of the Tribunal.
39. Applications for adjournment must, unless precluded by the circumstances, be made in writing and well in advance of the date set by the Tribunal. Applications for adjournment must clearly state the reasons for the application and be accompanied by supporting documentation where available. The party seeking an adjournment must advise other parties of the application, and obtain the written consent of the other parties where possible.
40. Unless an adjournment is expressly granted, parties should assume that the listing for which the adjournment is sought will proceed, and attend as directed with all appropriate witnesses, representatives, and documentation."The second respondent's email of 4 April 2014 seeking an adjournment sets out some reasons for requesting the adjournment. He states that he is being treated as an outpatient at Westmead Hospital. The documents from Westmead Hospital show that statement to be untrue. They do not disclose outpatient treatment. He states that he is seeing his general practitioner on a weekly basis. If that is so, that in my view is not a basis for an adjournment. I do not accept that a weekly doctor's appointment should cause a two day hearing to be abandoned. Finally, the second respondent states that he is attending at Westmead Hospital for scans and tests. The documents from Westmead Hospital show that statement to be true: however the scans are booked for 23 June 2014 !
Thirdly, on 21 February 2014 the respondents were given formal notice of the two day hearing on 8 and 9 April 2014. It was up to them to make all necessary arrangements to prepare for the hearing and to attend fully prepared to present their defence. On 12 December 2013, Senior Member J Smith at a directions hearing directed the parties to advise the registrar of their unavailable dates for a two day hearing in April/May 2014. The respondents were therefore on notice of an April hearing in December 2013.
Fourthly, if the proceeding were adjourned, the parties could not expect a two day hearing before August/September 2014.
Fifthly, the first respondent Mr John Maroon had in my view a responsibility to ensure that his defence in the proceedings, which was different to Mr Chris Maroon's position, was presented. This extended to ensuring that solicitors and expert witnesses were engaged for and attended at the hearing for the purposes of his defence. It was unacceptable in my view for him to say that he had left his defence to Mr Chris Maroon and was unable to proceed because Mr Chris Maroon was not at the hearing.
Finally, the fact that the respondents' solicitors notified the Tribunal on 3 April 2014 that they no longer acted for the respondents, only two clear business days before the hearing, and Mr C Maroon provided the Tribunal only one clear day's notice of his application for an adjournment of the hearing gives the impression, as submitted by the applicants' counsel, that the respondents were engaged in delaying tactics.
If adjournments were granted at the last moment without applicants complying with the CTTT's Chairperson's Directions Concerning Adjournments or the NCAT Procedural Direction relating to Home Building Disputes, the ability of the Tribunal to efficiently hold final hearings would be thrown into disarray. Further, if adjournments were granted on such a basis, the reasonable expectations of parties in the Tribunal to have the benefit of the timely disposition and resolution of their building disputes would be defeated.
Withdrawal of application
The applicants' case
The applicants' case against Mr J Maroon was briefly described by their counsel. It is that a written contract was signed by the applicants and the first respondent for residential building work to be carried out at their residence, the property. I would mention that the parties by their solicitors have filed and served points of claim and points of defence.
The contract price was $226,000.00, inclusive of GST. The applicants paid the first respondent $245,526.00 in connection with the building work.
The applicants allege that the work carried out by the first respondent is incomplete and defective. They allege that the first respondent has breached the contract and the statutory warranties implied into the contract pursuant to section 18B of the Act.
The applicants allege that they terminated the contract pursuant to the relevant terms.
The applicants claim the sum of $61,766.19 for defective work and the cost to complete work not completed by the first respondent.
They also claim that they have overpaid the first respondent the sum of $14,696.00.
All told, the sum of $76,462.19 is claimed from the first respondent.
Counsel for the applicants also briefly described the applicants' case against the second respondent, Mr C Maroon. They claim against him for negligent supervision of the building works carried out by the first respondent and for inducing them to believe that they were contracting with the builder of their choice.
Evidence
The applicants' evidence in the proceedings was:
(a)exhibit A - report of Mr T. Sherwood;
(b)exhibit B - statement of Olympia Linas;
(c)exhibit D - statement of Romas Linas; and
(d)exhibit D - ASIC search of AJM Construction.
The first respondent's evidence in the proceedings was:
(a)exhibit 1 - statement of John Maroon; and
(b)exhibit 2 - John Maroon's Home Building Licence details.
The Contract
The contract entered into by the parties was in evidence in a number of places. The contract was in the form of the NSW Fair Trading Home Building Contract for work over $5,000.00. As stated above, the contract price was $226,000.00, inclusive of GST. The contract was dated 29 February 2012 and signed by the parties (the "contract")
Clause 5 stated that the work was to commence 14 working days from the date of the contract, namely 29 February 2012.
Clause 6 of the contract dealt with the time for completion. The clause requires the parties to fill out the number of calendar weeks the contractor has to complete the works. The contract executed by the parties does not contain in this important piece of information.
If the parties to a contract do not state the date by which the contractor is obliged to complete the works, a term will usually be implied that the works are to be completed within a reasonable time. In fact, as pleaded in paragraph 38(d) of the points of claim and admitted in paragraph 38 of the points of defence, section 18B of the Act provides an implied warranty that the work will be done with due diligence and if no time is stipulated in the contract, within a reasonable time.
I note that in paragraph 35 (d) of their points of claim the applicants state that the works were to be completed within a realistic and reasonable time, which they claimed was six months from the date of commencement of the works. In paragraph 21 of their points of claim the applicants state that the works were commenced on or about 5 April 2012.
The question of what is a reasonable time for contract works to be carried cannot in my view be sustained by a party's mere assertion. Evidence of what is a reasonable time for completion is required, having regard to all of the relevant circumstances of the particular contract. Expert evidence on that question will normally be required.
I have read the applicants' expert report. So far as I can ascertain he does not express any opinion about what would be a realistic and reasonable time for the completion of the works.
However a Senior Building Inspector of the Department of Fair Trading expressed the view as at 21 May 2013 that there remained work to be completed within a reasonable time.
Abandonment of the works
In paragraph 26 of the points of claim the applicants allege that on 24 April 2013 the first and/or the second respondent abandoned the works and failed to return to the property. This is denied by the respondents in their points of defence.
The witness statement of Olympia Linas deals with the abandonment of works at paragraphs 75 - 81 of her statement. I have had regard to these paragraphs as they provide a full background to the issue. Mrs Linas's evidence is that on 4 March 2013 there was an inspection of the works attended by a Senior Building Inspector of the Department of Fair Trading, the applicants and the first respondent. As a result, a rectification order was issued. Tab 51 of Mrs Linas's statement attaches a letter dated 21 May 2013 from the Department of Fair Trading which indicates that inspections were carried out on 4 March and 13 May 2013 and that as at 21 May 2013 there were still incomplete items outstanding as identified. The letter from the Senior Building Inspector of the Department of Fair Trading concludes by stating;
"I am satisfied that this item forms part of the contracted works, remains incomplete and is the responsibility of the contractor to complete under section 18B(d) of the Home Building Act, 1989."
I am satisfied that the words "this item" refers to all items in the Department of Fair Trading's letter dated 21 May 2013.
Mrs Linas's evidence is that after this inspection there was a dispute with the second respondent about payments and on 24 April 2013 the respondent's ceased work and did not return to the site after that date.
The first respondent has given evidence about this issue in his statement. He attaches the rectification order he received from the Department of Fair Trading on 19 April 2013.
The first respondent's evidence confirms that here was a dispute between the parties about payments and on 23 April 2013 he left the applicant's property. I accept the applicant's evidence that the first respondent did not return to the site after 23 April 2013. From this evidence I conclude that the first respondent did in fact abandon the works under the contract as from 23 April 2013.
The first respondent's evidence at paragraph 30 provides further confirmation of this. He states that at 23 April 2013 the following work remained to be completed:
(a)"Landscaping;
(b)Concrete path on the side of the property;
(c)Final coat of paint; and
(d)Completion of gyprocking."
I would add that I do not regard a dispute about money or payments to be a justification for the first respondent abandoning the works. The contract gave remedies in clauses 24, Suspension of the Works, and in clause 26, Termination of contract by contractor, to the first respondent in connection with alleged failures to pay amounts due by the applicants. The fact that the first respondent failed to take advantage of contractual provisions contained in the contract for his protection is a matter for which he must assume responsibility.
Termination of the Contract
Clause 25 of the contract deals with the termination of the contract by the owner. I do not intend to set that clause out in full in these reasons for decision.
Clause 25 provided that if the first respondent fell into default in a number of ways the applicants would be entitled to notify him by writing that unless the default was remedied within 10 business days the applicants would terminate the contract. Clause 25 states the instances of default which would entitle the applicants to issue a notice under that clause. An inability or unwillingness to complete the work is one ground for the issue of a notice of default under clause 25.
Clause 25 goes on to state that if the first respondent did not comply with the applicants' request in the time provided, the applicants would be entitled to terminate the contract.
Counsel for the applicants referred me to Tabs 55 and 56 of the statement of Olympia Linas, exhibit A. Tab 55 is a contract notice dated 5 June 2013 from the applicants to the first respondent. This document stated that the applicants would terminate the contract pursuant to clause 25 if the first respondent, the building contractor under the contract, did not complete the contract works and rectify defective works within 10 business days of the contract.
There is no evidence of the first respondent replying to the applicants' contract notice dated 5 June 2013.
On 9 July 2013 the applicants sent the first respondent a notice of termination on the basis that he had failed to complete the contract works.
The respondent's points of defence denies the validity of the termination notice. The grounds upon which the denial is based are set out in a letter from the respondent's former solicitors, which is not in evidence.
In my view the applicants were entitled to give a notice under clause 25 of the contract requiring the first respondent to complete the contract works. The first respondent was in breach of the contract as he had abandoned the works and was in breach of section 18B(d) of the Act in not performing the remaining work with due diligence and in a reasonable time.
As the first respondent failed to comply with or respond to the applicants' request of 5 June 2013, they were in my opinion entitled to terminate the contract as provided for in clause 25, and which they did on 9 July 2013.
Clause 25 of the contract contained a formula for determining whether money is payable by the owner to the builder or by the builder to the owner as a result of an owner termination. The essence of the formula is to ascertain the reasonable cost to complete the work and then calculate whether that reasonable cost exceeds that which would have otherwise been due under the contract.
The applicants have not approached their calculation of damages strictly in accordance with clause 25 of the contract. As a result I do not make any finding of damages flowing from the termination of the contract based on clause 25.
Breaches of Contract
The applicants allege breaches of contract, including breach of statutory warranties, by the first respondent in paragraphs 35 - 39 of the Points of Claim.
In my view, to the extent that the first respondent has performed work which is defective, he will be liable in damages for breach of the implied warranty set out in section 18B(a) of the Act that work will be carried out in a proper and workmanlike manner.
Further, to the extent that the first respondent failed to complete work required to be carried out under the contract, which is a large part of the applicants' case, he will be liable in damages for breach of the implied warranty set out in section 18B (d) of the Act that work will be done with due diligence and within a reasonable time.
Evidence of the breaches of contract and statutory warranties are contained in exhibit A, the report of Mr T. Sherwood. Mr Sherwood has set out his background and experience. He confirms that his report has been prepared in accordance with the Tribunal's "Expert Witness Code of Conduct Chairpersons Directions CTTT CD2003-2". Based on his background and experience and his acceptance of the Expert Witness Code of Conduct, I accept Mr Sherwood as an expert capable of giving opinion evidence in the Tribunal.
In his report, Mr Sherwood identifies incomplete work and sets out a cost to complete the contract works dealing with internal and external works. He describes in detail 23 items of incomplete internal and external works. He values the cost of incomplete works as $52,985.82. Mr Sherwood cross refers each item of incomplete work to identified photographs. He sets out a scope of work for each incomplete item, provides a labour/materials allowance with quantities, a rate and a subtotal.
I am satisfied that he has prepared his report in a diligent way such that his items of incomplete work and the costing relating to them may be relied upon.
He has also identified five items of defective work which he describes in some detail. He has also in connection with these items of defective work, cross referred each item to photographs. He sets out a scope of work for each defective item, provides a labour/materials allowance with quantities, a rate and a subtotal for each item. Mr Sherwood has valued the five items of defective work at $8,780.37.
I am also satisfied that he has prepared his report in a diligent way such that his items of defective work and the costing relating to them may be relied upon.
Mr Sherwood has allowed preliminaries of 10%, profits and overheads of 15% and GST of 10% on his calculations of incomplete work and defective work. These amounts are included in the figures set out above and are, I find, reasonable.
I accept Mr Sherwood's evidence relating to incomplete work and defective work and his assessment of the cost of completing incomplete works at $52,985.82 and the cost of rectifying defective work at $8,780.37, totalling $61,766.19.
I will make an order that the first respondent must pay the applicants the sum of $61,766.19 within 21 days of the date of the order as damages for breach of contract.
The applicants' overpayment case
As stated above, the applicants claim that they have overpaid the first respondent the sum of $14,696.00 and seek an order for the first respondent to repay that amount.
In paragraph 3 of their prayer for relief on page 18 of their points of claim, the applicants claim restitution for amounts overpaid in the sum of $16,876.00. The points of claim address this head of claim in clause 37(d).
The evidence in support of this claim is set out in Mr Sherwood's expert report.
At page 9 of his report Mr Sherwood has calculated the total amounts paid by the applicants which he calculates at $245,526.00. He then states that the applicants have accepted and made variation payments of $4,830.00 which are included in the sum of $245,562.00. He then states that the payments made by the applicants which exceed the contact price of $226,000.00, are $14,696.00.
However, if one deducts the contact price of $226,000.0 from the total amount paid by the applicants, $245,526.00 ($245,526.00 - $226,000.00) the balance is $19,526.00.
The difference between the sum of $19,526.00 and $14,696.00 is $4,830.00, which is the amount of variation payments accepted and made by the applicants. Mr Sherwood has made this plain in appendix 4.0 of his report.
The amount of $14,696.00 as the amount of the applicants' overpayment will in my view only have validity if one accepts that the applicants' variation liability under the contract is $4,830.00. However, Mr Sherwood has made no attempt in his report to review each variation claimed by the first respondent. He has accepted the applicants' assessment of their variation liability as $4,830.00 under the heading 'Homeowner Accepted Variations' in appendix 4.0 of his report.
There is evidence that the first respondent was claiming variations under the contract. Tab 36 to Mrs Linas's statement is an email dated 12 December 2012 from the second respondent to Mr Linas regarding accounting issues and in particular variations. The second respondent asserts in his email that variations are "adding up to 50K".
Given that:
(a)there is evidence that variations asserted on behalf of the first respondent are in the vicinity of $50,000.00,
(b)the applicants' expert has not carried out an independent assessment of the true value of variations under the contract, but has accepted the applicants' "accepted variations"; and
(c)in my view, the calculation of the sum of $14,696.00 as an overpayment will only have validity if one accepts that the applicants' variation liability under the contract is $4,830.00;
(a)I am not satisfied on the balance of probabilities that the applicants have in fact overpaid the first respondent the sum of $14,696.00.
As a result of the reasons in the preceding paragraphs, I dismiss the applicants' claim for $14,696.00 as an overpayment made to the first respondent under the contract.
(b)
The case against the second respondent
As stated above the applicants' case against the second respondent Mr C Maroon is for negligent supervision of the building works carried out by the first respondent and for inducing them to believe that they were contracting with the builder of their choice.
Counsel for the applicants stated that their case against the second respondent is set out in paragraphs 8, 13, 18, 20, 23, 43, 47 and 53 of their points of claim.
Counsel for the applicants also stated that the evidence supporting the allegations in the paragraphs referred to is contained in paragraphs 4, 5, 7 13, 33, 35, 36, 71, 77, 78 and 80 of Mrs Linas's statement.
Paragraph 13 of the points of claim alleges that on or about 29 February 2013, the same day as the applicants signed the contract, the applicants entered into an agreement with the second respondent for him to project manage the works. The terms of the agreement are set out in paragraph 18 of the points of claim and are said to be implied. These allegations are denied by the second respondent.
I have considered the evidence of the applicants, as referred to above, in support of the case against the second respondent and in particular whether an agreement was entered into, as alleged by them, with the second respondent whereby he was to provide project management services for them in connection with the building works being carried out.
Paragraph 33 of Mrs Linas's statement is important as it deals with the meeting that the applicants had with the second respondent in connection with the signing of the contract. Mrs Linas states details of the conversations that she had with the second respondent, which I accept. These conversations were in connection with the building contract entered into with the first respondent. Mrs Linas's evidence does not establish that anything was said on 29 February 2012 that was capable of sustaining the proposition that an agreement was on that day entered into with the second respondent as alleged in paragraph 13 of the points of claim.
The particulars of paragraph 13 of the points of claim refer to discussions held between the applicants and the second respondent in January and/or February 2012 in support of the project management agreement alleged.
I have had regard to paragraphs 1-32 of Mrs Linas's statement to ascertain whether her evidence in those paragraphs is capable of sustaining the proposition that an agreement was entered into with the second respondent as alleged in paragraph 13 of the points of claim.
I am unable to find any evidence in paragraphs 1-32 of Mrs Linas's statement that discloses an intention on the part of the applicants and the second respondent to enter into a contractual arrangement whereby the second respondent would provide project management services for the benefit of the applicants for some valuable consideration.
The particulars of paragraph 13 of the points of claim also refer to unidentified written communications between the applicants and the second respondent which evidences the agreement. Counsel for the applicants referred me to Tab 36 to Mrs Linas's statement in support of the allegation that the applicants entered into an agreement with the second respondent for him to project manage the works.
Tab 36 is an email dated 12 December 2012 from the second respondent to Mr Linas regarding accounting issues and in particular variations. The email states, among other things, "I have eliminated the builders fee and just allowed a small management wage to try and help as much as i can with costs," (sic). I regard this passage as relating to the costing of variations, rather than being evidence of a project management agreement entered into between the parties.
For the reasons set out above I find that the applicants have failed to establish that they entered into a project management agreement with the second respondent as alleged in paragraph 13 of their points of claim.
While I accept that the second respondent played an important part in the preparation for and the carrying out of the work under the contract, I am not required to ascertain in a legal sense, what his precise role was. However, I have found that whatever role he was playing, it was not as the applicants' project manager.
The applicants also allege that the second respondent owed a duty of care to the applicants because he was engaged as a project manager and held himself out to be a professional project manager. I have already found that the second respondent was not engaged as a project manager. To the extent that the allegation that the second respondent owed a duty of care to the applicants relies upon that basis, it fails.
In addition I am not satisfied having regard to all of the applicants' evidence that the second respondent held himself out as a 'professional project manager', as alleged by the applicants in paragraph 44 of their points of claim.
I dismiss the applicants' case against the second respondent in connection with the provision of project management services
The applicants' case under the Australian Consumer Law
Paragraphs 47 to 56 of the applicants' points of claim raise allegations regarding the licence status of the first respondent under the Act.
The complaint is that representations were made that the first respondent was licensed under the Act and such licence permitted the first respondent to enter into the contract and undertake the works.
The applicants further allege that the first respondent was the holder of a contract licence under the Act that prohibited him from entering into the contract or performing any works requiring home warranty insurance under the Act.
The applicants allege that the representations were false and misleading.
The second respondent tendered as exhibit 2 an extract from the Government Licensing Service which shows a print date of 1 November 2013. The extract shows that the second respondent is licensed under the Act, holding a Contractor Licence. The extract also shows that a licence condition is "ONLY FOR CONTRACTS NOT REQUIRING HOME WARRANTY INSURANCE" for the period 31 December 2010 to 31 March 2012.
As stated above, the contract was entered into on 29 February 2012 one calendar month before the expiration of the condition referred to above. On 29 March 2012 the first respondent obtained a Home Warranty Certificate of Insurance in favour of Mr Romas Linas in connection with the works. Mrs Linas's evidence is that she received the Home Warranty Certificate of Insurance on 29 March 2012.
The applicants claim that they would not have entered into the contract had they known that the first respondent held a builder's licence with the condition referred to above.
The applicants' evidence in the Tribunal does not support any of the allegations set out in paragraphs 47 or 50 of the points of claim. The only evidence that I can see going to this issue is paragraph 33 of Mrs Linas's statement. That paragraph does not support the matters alleged at paragraph 47 or 50 of the points of claim. That evidence indicates that Mr Linas was aware that home owners warranty insurance was required and he asked where it was. He was told that it was coming. It was produced one month afterwards.
I do not accept that the representation referred to in paragraph 47 of the points of claim was, or could be implied as asserted in the particulars to the paragraph.
I note that the respondents admit that the second respondent did represent that the first respondent was the holder of a building licence and that at 29 February 2012, his licence restricted him from doing work requiring home owners warranty insurance. However the admission by the respondents does not correspond to the representation alleged by the applicants at paragraph 47 of their points of claim.
For the reasons set out above I dismiss the applicants' case under the Australian Consumer Law.
Work Order
The first respondent applied for a work order under section 48O(1)(c) of the Act. I declined to make such an order.
My reasons for declining making a work order are that the first respondent has not provided any evidence that he is actually in a position to carry out the remaining work. In the past he has received Department of Fair Trading rectification orders which he failed to comply with.
In addition he is still in dispute with the applicants being the claimant in HB 14/04873 where he seeks payment of the sum of $40,849.00.
Given the past history between the parties, the fact that the first respondent had opportunities to carry out the incomplete work in the past, but failed to do so and the fact that the parties are still in formal dispute, I will not make a work order as requested by the first applicant.
Costs
The parties are at liberty to make a costs application in these proceedings.
Any costs application pursuant to section 53 of the Consumer, Trader and Tenancy Tribunal Act2001 must be lodged in the Tribunal and served on the costs respondent within 21 days of the date of this order either attaching or referring to the documents relied upon in support of the application.
The costs respondent will have 21 days after the date it receives the application referred to in the preceding paragraph to lodge in the Tribunal and serve on the costs applicant its submissions, if any, in response to the cost applicant's costs application, such submissions either attaching or referring to the documents relied upon.
The cost applicant will have 14 days after the date it receives the cost respondent's submissions to lodge in the Tribunal and serve on the costs respondent its submissions, if any, in reply, such submissions either attaching or referring to the documents relied upon.
The Tribunal will determine any costs application on the basis of the submissions and document lodged in the Tribunal.
D Goldstein
Senior Member
Civil and Administrative Tribunal of New South Wales16 April 2014
I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal.
Registrar
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